29 July 2002

South Africa: Business And NGOs Must Seize the Day


Johannesburg — AN UNEXPECTED convergence has emerged suddenly in the often stormy courtship between SA's nonprofit and business sectors. The findings of a recent research report suggest that it is time the two sectors seek co-operation in the interests of sustainable development and business growth.

The report comes at a time when SA's corporates are grappling with the implications of the second King report, which suggests a social responsibility framework for business in terms of the "triple bottom line" of financial, social and environmental accountability.

And next month's World Summit on Sustainable Development in Johannesburg is expected to give further impetus to the debate.

Significantly, the nonprofit study reveals that corporate investment in development is quantitatively substantial, even while its actual effect on poverty is qualitatively uncertain.

The King report states that "sustainability" or "social, ethical and environmental issues can no longer be regarded as secondary to more conventional business imperatives".

The report recommends ethical, integrated and strategic approaches to social investment spending, and specifically locates the whole "sustainability" question within a framework of "African humanism" or ubuntu, which recognises the importance of interdependent relationships, in this case between an enterprise and the community in which it exists.

In the international arena, the "global compact", emphasises the need to build cross-sectoral partnerships in support of poverty alleviation and sustainable development. This compact calls for alignment of corporate policy and practice with values upholding enlightened human rights, labour and environmental standards.

Much closer to home, the New Partnership for Africa's Development initiative is underpinned by concepts of mutual partnership between government, business and civil society.

Given these overarching moves towards cross-sectoral co-operation, it seems that this is the ideal time for SA business and nonprofit players to "seize the day" as suggested by King.

The perception within the nonprofit sector is that lack of finance is the key impediment to effective delivery. The new study shows that the "lack" is really in the area of leadership and management capacity.

It is now time for nonprofit organisations to capacitate themselves to take advantage of SA's very progressive policy environment, and the considerable resources available to them. The "lack" is not funding, it is strategy, management and information.

While the challenge for the organisations is to move quickly to become effective implementers of development, corporate donors need more integrated strategies, implemented through closer social engagement.

The corporate sector should recognise that both its business and social responsibility activities will increasingly happen in an environment demanding real accountability.

Business and the nongovernmental or nonprofit sectors are traditionally viewed as adversaries, locked in a combat of values and scarce resources. But both globally and nationally, that terrain is changing.

While there is no doubt that there will always be a need for the "watchdog", or civil regulation role of nongovernmental organisations, the urgent need is for on-the-ground, tangible development.

Given a state apparatus still too weak to meet all needs, the call must be for multisectoral co-operation in the interests of successful sustainable development programmes.

It is in moving to meet these challenges that the rationale for business/nonprofit organisations co-operation emerges.

For instance at the micro level, such co-operation can look for solutions to local social and environmental problems, while at the macro or policy level, business and nonprofit organisations can work to develop mutually acceptable best practices, monitoring and evaluation methodologies, and specifically SA indicators and standards for monitoring the effect of their sustainability initiatives.

Du Toit is Director of the Southern African Grantmakers Association. Eugene Saldanha is Director of the NonProfit Partnership.

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